YANGON UNIVERSITY OF ECONOMICS

DEPARTMENT OF COMMERCE
MASTER OF BANKING AND FINANCE PROGRAMME

Issues Encountered Regulating FinTech within Financial

Service Businesses of Myanmar

KAUNG HTET ZAW

(EMBF-5th -11)

DECEMBER, 2019
 YANGON UNIVERSITY OF ECONOMICS
DEPARTMENT OF COMMERCE
MASTER OF BANKING AND FINANCE PROGRAMME

Issues Encountered Regulating FinTech within Financial Service

Businesses of Myanmar

2018-2019 Academic Year

MBF 5th Batch

Supervised by: Submitted by:

Daw Khin Nwe Ohn Kaung Htet Zaw

Associate Professor MBF - 11
Department of Commerce Batch - 5
Yangon University of Economics Yangon University of Economics
 ABSTRACT

This study was to identify the regulations for FinTech in Myanmar and find out
the issues encountered regulating FinTech within the financial service businesses of
Myanmar. FinTech ecosystem does not exist significantly yet and financial inclusion
remains challenging in the lowest financially literate population or in the unbanked
areas. Some FinTech start-ups are working in an uncertain legal environment that
poses risks to the stakeholders in some ways while the benefits may be well presented
to the economy. The banks are on a digitization journey under the existing legal
framework that used to be adaptable to the development. The research finding was
conducted through a structured survey to a sample size of twenty-two senior
executives from some commercial banks, investment firms, insurance company,
FinTech start-ups, Tech Hub, IT businesses and payment services provider out of
thirty-six population targeted. The survey included thirty-nine statements finding out
the issues with regards to regulating FinTech in six different sections. From this
finding, the highest response rate hit the issues encountered regulating FinTech are
related to: cross-department coordination within the government; adequate regulatory
support; managing the underlying issues. The other issues include the need to
collaborate with the international partners, supportive government budget and
addressing AML/CFT issues in order to develop an adequate FinTech ecosystem, a
stable and efficient regulatory environment. The profound government has profound
 ACKNOWLEDGEMENT

I would like to thank Professor Dr. Tin Win, Rector and Professor Dr. Nilar
Myint Htoo, Pro-rector of Yangon University of Economics, for their thoughtful
leadership in bringing this university to a brighter day forward.

I am so glad about the motherly care of Professor Dr. Daw Soe Thu,
Programme Director of MBF and Head of Department of Commerce, YUEco
throughout these three years.

I would like to express my deepest gratitude to my supervisor, Associate

Professor Daw Khin Nwe Ohn for her kind and constructive guidance to produce the
adequate research paper despite of her hectic schedule. I also would like to thank the
Yangon University of Economics (YUEco) Academic Board for granting me to study
in the Executive Master of Banking and Finance Programme (EMBF). My heartfelt
thanks also go to the lecturers, professors and visiting professors for their quality
lectures and guidance.

I am grateful to Mr. Warren Pain, Mr. Douglas Barnes and Mr. Timothy
Duckett, Directors of Department for International Trade (DIT), British Embassy
Yangon, for allowing me the flexible working hours and giving me the opportunity to
learn more about FinTech through the UK contacts and the conferences. I thank my
colleagues in DIT, DFID, Financial Conduct Authority (FCA) and the Bank of
England for sharing the UK expertise and experience, and also programs in Myanmar
throughout our work.

I am so pleased to have my dad and mom, family and relatives for their
continuous support anytime they think I need it and bearing my careless behavior
sometimes. I am so thankful to my friends and classmates for having fun studying
together and supporting each other, especially to Tint Tint Shoon Wai for lending a
hand whenever I needed during the critical times and Aung Thet Din for forcibly
encouraging me to attend this programme.

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 TABLE OF CONTENTS

Page
ABSTRACT i
ACKNOWLEDGEMENTS ii
TABLE OF CONTENTS iii
LIST OF TABLES v
LIST OF ABBREVIATIONS vi
CHAPTER I INTRODUCTION 1
1.1 Rationale of the Study 2
1.2 Objective of the Study 3
1.3 Scope and Method of Study 3
1.4 Organization of the Study 3

CHAPTER II LITERATURE REVIEW OF FINTECH 4

2.1 Overview of global FinTech Landscape 4
2.2 Regulatory ‘sandbox’ Approach for FinTech in the 5
UK
2.3 Issues Encountering Globally for Regulating 5
FinTech
CHAPTER III OVERVIEW OF FINTECH AND THE RELATED 18
REGULATIONS IN MYANMAR
3.1 FinTech in Myanmar 18
3.2 Regulating FinTech in Myanmar 19
3.3 Regulations Related to FinTech in Myanmar 22

CHAPTER IV ANALYSIS ON ISSUES ENCOUNTERED 25

REGULATING FINTECH WITHIN THE
FINANCIAL SERVICE BUSINESSES OF
MYANMAR
4.1 Research Design 25

iv
 4.2 Demographic Profile 27
4.3 Analysis on Issues Encountered Regulating FinTech 35
within Financial Service Businesses of Myanmar
CHAPTER V CONCLUSION 41
5.1 Findings 41
5.2 Suggestion 43
5.3 Need for Further Study 44

REFERENCES 45
APPENDIX

v
 LISTS OF TABLE

Table Page
4.1 Role of Respondents 25
4.2 Type of Business vs. No. of Respondents 26
4.3 Financial Inclusion 26
4.4 Ecosystem
4.5 Ease of Doing Business 26
4.6 Regulatory Support 27
4.7 Others 28

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 LISTS OF ABBREVIATIONS

CBM Central Bank of Myanmar

FCA Financial Conduct Authority
FIs Financial Institutions
MFS Mobile Financial Services
AML/CFT Anti-money laundering and counter-terrorism
financing
UK United Kingdom
MoPF Ministry of Planning and Finance
FinTech Financial Technology
IT Information Technology
SWIFT Society for Worldwide Interbank Financial
Telecommunication
FATF Financial Action Task Force

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 Chapter I

Introduction

In the Myanmar market, for the sake of financial inclusion, mobile wallets and
digital pay services came into the market three years ago. Myanmar domestic banks
have been on digitalization journey since 2015 with the start of Yoma Bank’s Misys
Core Banking software installation. Development of private sector led FinTech
services growth is phenomenal nowadays. Mobile phone penetration and increased
internet service availability are also driving the digital offers for FinTech services in
the market. However, the businesses demand a better regulatory environment to suit
their supply in the market.

The term “FinTech” is a brief representation used to the financial technologies

used in the financial services industry. The technology has helped to increase the
efficiency of the financial services providers and financial inclusion to the global
citizens.

The Central Bank of Myanmar (CBM) as the regulator issued a directive for
the Mobile Banking and a regulation of Mobile Financial Services in 2013 and 2016.
The directive allowed banks and financial institutions to use mobile banking software
to develop efficient services while managing risks and complying anti-money
laundering and counter-financing terrorism (AML/CFT) rules. The regulation allowed
mobile financial services providers to offer digital money transfer through phone
number and agents for their customers.

The private sector organizations urge that the regulator, the CBM to initiate
rapid creation of enabling regulatory environment in the market amidst of driven
factors from the international markets. Although certain FinTech service providers are
eager to push for a speedy development, banks consider FinTech service providers as
competitors. However, all parties understand that different financial technology can
be applicable for the respective business efficiency.

The regulators expressed their eagerness to develop the industry step by step
with respect to the available capacity and required infrastructure. The strategy for
regulating FinTech with the significant involvement of private sector stakeholders is
still out of sight.

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1.1 Rationale of the Study

Financial technology has been evolving in Myanmar and many kinds of risk
also appear with regards to stability of financial industry in the nascent market. This
study will identify the existing FinTech regulations and risks associated in Myanmar.
Technological experts alone cannot create the digital financial services. Myanmar
regulator ought to take initiatives to regulate FinTech products/services with no harm
to the public taking into account of their existing resources and facilities. Therefore,
the role of banking and finance professionals plays a crucial role in providing these
efficient services to the public.

Banking financial institutions traditionally believe that FinTech businesses

challenge their position in the revenue generation regards. However, non-banking
financial institutions continue to produce efficient technologies which can sell to
banking financial institutions or sell their services to consumers directly. Most of the
case studies have proved that such digital financial services serve economies in many
better ways. Regulators around the world are currently collaborating in regulatory
aspects. The UK’s Financial Conduct Authority led the regulatory approach and it will
be taken an example in this research.

The Central Bank of Myanmar expressed its ambition to encourage evolution

of FinTech area in a long-term plan. But, the businesses in Myanmar demands a
quicker approach to allow FinTech development with the heavy support of the
regulator. This study will examine ways for possible collaboration between the
regulator, Central Bank of Myanmar, and other stakeholders based on mutual
understanding.

1.2 Objectives of the Study

The main objectives of the study are:

(1) To identify the regulations for FinTech in Myanmar

(2) To find out issues encountered regulating FinTech within financial service
businesses of Myanmar

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1.3 Scope and Method of the Study

This thesis studies the existing FinTech regulations in Myanmar and find out
the issues that are encountered while regulating FinTech within the financial service
businesses of Myanmar. The survey was conducted through emails to a sample size of
twenty-two; twelve banking professionals, two investment specialists, two FinTech
entrepreneurs, one insurance company CEO, four IT experts and a Tech Hub CEO,
out of a thirty-six population.

Primary data collection was done through a structured questionnaire and

secondary data from reports, working papers, news and other related research studies
of the reliable sources. The respondents included executives and senior managers in
seven commercial banks, investment firms, FinTech startups, insurance company,
payments network service provider, IT, tech hub and FinTech solution provider. The
data was analyzed and found out the issues encountered related to regulating FinTech
based on the responses from the financial service and IT businesses of Myanmar. The
data was then interpreted referring to the issues encountered percentage.

1.4 Organization of the Study

This thesis is comprised of five chapters.

Chapter (I) includes introduction parts which describes rationale, objectives,

scope and method, and organization of the study. Chapter (II) discusses an overview
of global FinTech landscape, regulating approach and issues encountering globally to
regulate FinTech. Chapter (III) FinTech in Myanmar, regulating for FinTech in
Myanmar. Chapter (IV) shows evaluation and analysis of issues of regulations for
FinTech in Myanmar financial services market based on the survey conducted to
private sector stakeholders and the regulator. Chapter (V) concludes with summary of
the whole thesis. In this part, the suggestion and recommendation to prioritize various
tasks with respect to regulatory part based on the available resources and importance.

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 Chapter II

Literature Review

In this chapter, a review of relevant background literature of Regulating

FinTech and issues encountered to regulate FinTech globally. This chapter includes
three sections; the first one presents an overview of global FinTech landscape; the
second one explains regulating financial services and ‘sandbox’ approach for the
FinTech in the UK; the third one highlights the issues encountering for regulating
FinTech globally.

2.1 Overview of global FinTech Landscape

Digital transformation has been taking place for decades in global financial
services industry. The journey is driven effectively by non-bank innovators offering
both customers facing and back office financial technology products and services
(Digital Financial Services Paper, IFC, 2017). FinTech has increased business-to-
business and business to customers interactions and is delivering better results in the
international markets. Functions such as reconfiguration of design, operation,
marketing, analytics, supply chain and delivery have become more efficient in the
banks with FinTech innovations. In the global non-bank FinTech space, innovative
products such as remittances, payments, lending, trade financing, investment
management and insurance are already up and running in several markets. Moreover,
distributed ledger technology-based digital currency is also another popular FinTech
product, but it is not yet accepted in most markets.

Core banking software solution is changing the way banks operate. It supports
banking transactions processing such as deposit, loan and credit processing across the
various branches of a bank. This safer and faster FinTech can bring down cost
considerably as it ensures to require lesser manpower to execute operations. Payment
systems are also developing to faster and cheaper payments that go within the same
market or across the borders. Many banks are pulling back from correspondent
banking because of risk and compliance concerns, and, post-recession, traditional
banks have become reluctant to lend to smaller businesses. (Anders la Cour, 2019) In

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Europe, non-bank FI is able to provide multi-currency payment through virtual
IBANs (International Bank Account Number) for B2C (Business to Client). SWIFT
(Society for Worldwide Interbank Financial Telecommunication) has also advanced
with SWIFT gpi (SWIFT Global Payment Innovation) that drives the connectivity for
a faster and more transparent payment solutions. (Ingrid Weisskopf, 2019) Mobile
wallets are needless to say that they are changing today’s lifestyle until creating
financial inclusion for the population underserved by the traditional financial services
firms.

On the investment side, FinTech stocks has gained momentum with

NASDAQ:FINX which is an ETF and entered in the top list of S&P 500 index since
its inception in 2016. (Matthew Cocchrane, July 2019) The international top ten
FinTech stocks are related to e-Commerce, bank technology, digital payment systems,
accounting software, insurance software and bank. Other investment in FinTech set
the record with $36.6 billion of venture capital invested in the sector across 2,304
deals, a 148% or 2.5x increase from 2017 and a 329% or 4.3x increase over five
years. China, United States and United Kingdom are the top three countries invested
in total capital in 2018. (Innovate Finance, 2018 FinTech VC Investment Landscape)
In terms of number of FinTech investment deals, London, New York, San Francisco,
Beijing and Singapore got into the top list in August 2019. (London and Partners/
Innovate Finance, September 2019)

As for the barriers, one of the biggest concerns for investment firms interested
in FinTech is regulation complexity according to a report by Mayer Brown law firm
in the UK in 2017. In particular they wished to see a change in the way regulation is
applied to the business. The financial services sector will grow with clear guidelines
in place, desire for new solution, delivery mechanisms and customer communications
channels. (Nicholas Roi, March 2017)

As FinTech firms innovate, the risks of financial crimes and frauds also
increase as non-bank FinTech firms do not deploy very tight controls such as banks
and some other traditional FIs. The FATF (Financial Action Task Force) stated that it
supports responsible financial innovation that aligns with the AML/CFT requirements
found in the FATF Standards and also improve the effective implementation of
AML/CFT measures for the new FinTech may present. The FATF discussed to fight

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ML/FT, encourage public and private sector engagement, pursue positive and
responsible innovation, set clear regulatory expectations and smart regulation which
address risks as well as allow for innovation and make fair and consistent regulation.
(FATF/GAFILAT Plenary, November 2017)

The more systems are connected on the internet, the better firms require to
protect their critical infrastructure cybersecurity. All the financial institutions handle
the important personal and commercial information as well as analytics. Those are
legally responsible to protect from any intruders. The Carbanak attacks was one of the
incidents happened in early 2013 that was malware-based bank thefts totaling more
than $1 billion. The attack damaged against many banks simultaneously that utilized
several such as ATMs, credit and debit cards, and wire transfers. The attackers set out
an advanced knowledge of the cyber landscape and also experience in banking
process, controls, and weaknesses arising from siloed organizations and governance.
In the European Union, the General Data Protection Regulation (GDPR) 2018
requires firms to report breaches to the competent supervisory authority within 72
hours. Failure to that compliance could result in up to EUR 20 million or 4 percent of
global annual turnover (whichever is higher). (Antoine Bouveret, IMF Working
Paper, Cyber Risk for the FS, June 2018)

While the change in financial services industry is happening, the workforce

skills also need to cope with the trend. FinTech products support business efficiency
and these products also reduce human talents requirements for the business functions.
Compiling and sifting through enormous swaths of data and analyzing contracts done
by machines are really effective. Therefore, number of workforces required to do
complex jobs has been reduced in the financial institutions. The machine learning and
artificial intelligence (AI) are improving to automate operations in a matter of weeks.
However, regulation and supervision can cause delay the rapid adoption of
automation. 42 percent of FinTech currently have a digital skills shortage: 56 percent
are filling the gap by hiring additional UK talent, 46 percent by additional talent and
34% by non-EU talent. (The future of talent in banking: workforce evolution in the
digital era, EY, April 2018)

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2.2 Regulatory ‘sandbox’ approach for FinTech in the UK

In the UK, the Financial Conduct Authority (FCA) was created by Parliament
in 2013 as the regulator of the conduct of financial services. The FCA regulates over
56,000 firms including FinTech businesses. The objective of the FCA is to ensure that
relevant markets function well and three operational objectives to advance: Protect
consumers – to secure appropriate protection for consumers; Integrity – to protect and
enhance the integrity of the UK financial system; Promote competition – to promote
effective competition in consumers’ interests. The FCA aim to be transparent and not
just the benefits of regulation but also the costs. And the regulator delivers specific
regulatory functions such as authorizations, supervision and enforcement as well as
interpretation of their Competition duties and the needs of consumers. (Andrew
Bailey, FCA, How we regulate financial services, 2017)

The regulator identifies harm, potential harm or markets not working well as
they could do. They categorize harm in financial services into five types that may
overlap. After identifying potential harm, diagnostic the cause, extent and potential
development carry out as the second step. This step comes with a fee charged to the
firms that is paid for the FCA’s direct cost. The tools FCA used are individual firm
analysis, Section 166 FSMA powers, data analysis, investigations, multi-firm work
and thematic reviews, market studies and policy work. The final decisions are
independently scrutinized by the Regulatory Decisions Committee. Regulatory actions
are taken after diagnosis. Regulatory tools are used to make judgement about whether
these tools can remedy or mitigate the harm cost-effectively. The intervention tools
include rule changes, guidance, communications to firms, communications to
customers and variation or removal of permissions. Testing of effectiveness of the
remedies helps in making better decision and add more public value. The regulators
monitor and publish key indicators that help to demonstrate the impact of
interventions.

According to Chris Woolard, Director of Strategy and Competition of FCA,

stated the importance of regulation to create an environment for true competition and
innovation to occur. The CEO of the Financial Services Regulatory Authority of Abu
Dhabi Global Markets Richard Teng discussed the critical role of regulators to
harmonize between encouraging the growth of FinTech and innovation while ensuring

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financing stability. He convinced that regulators need to be active in the FinTech
space to achieve this, by engaging with stakeholders and providing ‘sandbox’
environments to FinTechs in order to best identify and understand risks.

The regulatory sandbox (‘sandbox’) allows firms to test innovative products,

services and business models in a live market environment, while ensuring that
appropriate safeguards are in place. The sandbox is an experiment for the regulators
as well as for the firms testing in the sandbox. The FCA’s November 2015 report set
out the potential benefits of the sandbox that would support the objectives as to reduce
the time and, potentially, the cost of getting innovative ideas to market, to enable
greater access to fiancé for innovators, by reducing regulatory uncertainty, to enable
more products to be tested and, thus, potentially introduced to the market and to allow
the FCA to work with innovators to ensure that appropriate consumer protection
safeguards are built into new products and services. The sandbox operates on a cohort
basis with two six-month test periods per year. Firms must submit an application
setting out how they meet the FCA’s eligibility criteria for testing in the sandbox with
the tools; restricted authorization, rule waivers, individual guidance and no
enforcement action letters. (FCA Regulatory sandbox lessons learned report, Oct
2017)

The sandbox sets the indicators of success. All sandbox tests have adhered to
their standard safeguards. FCA have worked with firms to develop bespoke
safeguards for tests. One firm successfully triggered their exit plan due to lack of
consumer uptake during the test. The FCA maintains FinTech ecosystem so that the
regulatory function align with the needs the service providers and consumers. The
ecosystem results in mutually beneficial cooperation among the stakeholders and
deliver lower cost, quicker services and better quality to the public. It is made up of
FinTech innovators, regulators, financial institutions and consumers. (FinTech
ecosystem playbook, EY and Singapore FinTech Association)

2.3 Issues Encountering Globally for Regulating FinTech

According to Anton Didenko’s article about Regulating FinTech: Lessons

from Africa in the San Diego International Law Journal (06-15-2018), regulating

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FinTech can be complex in nature as it associates with different fields and industries
such as financial services, information technology and legal. FinTech regulations are
not just technology related in most cases. It heavily associates with banking, financial
and economic norms. And the heavily regulated financial services sector in most
jurisdictions uses to arise legal uncertainty as there may be gap in regulation or
conflict each other. It is usual that financial institutions develop relationships with the
regulator to make clear of the existing legal position, smaller FinTech businesses may
not be ready to discuss due to the lack of third-party legal expertise. Even if pre-
existing regulatory measures are generally sufficient to support the new technology,
further regulatory intervention may still be necessary.

Smaller FinTech firms are not usually capable to engage with existing law
when it is not easily accessible without specialized training. The inadequate common
language can divide working together on both sides. Programme such as incubator or
accelerator can fill the gap in order to smoothen the communication between the
regulator and FinTech start-up firms. They can also facilitate investment targets,
collect data and analyze the law for any gaps or weaknesses in the context of the new
technology solutions. It also highlighted that overreliance on principles-based
guidance could lead to a lack of certainty and may discourage businesses without
having regulatory support and proper communication mechanism.

Another issue is regulating transnational FinTech such as cross-border

payment solutions, foreign currency trading, virtual currencies and other that affect
the local financial system. The foreign regulators’ actions also can affect in the
domestic market. So, coordination among the international regulators requires to
cooperate in addressing regulatory challenges and resolution required. In the case of
cryptocurrencies, most countries chose a “hands off” approach, some have taken
action to classify virtual currencies according to the domestic law in Australia and the
UK, or by differentiating between real and fake cryptocurrencies in Switzerland.
Russia went on another approach with detailed rules governing cryptocurrencies with
draft federal legislation.

Unequal treatment can potentially lead to an issue while regulating FinTech.

Even though financial services are regulated in a neutral manner, principles-based
approach would effectively prioritize large financial institutions. For example, the law

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would significantly limit the opportunities for the emergence of non-bank
crowdfunding platforms if it characterizes a bank as any organization receiving
deposits from a pre-defined floor number of depositors. Similarly, FinTech labs
operate within incumbent financial institutions or in association with them but it can
be confused if they are given a preferential position so as to dominate the regulator
with respect to the firms that are close with them. This will only undermine
competition in the financial services market.

Regulators ought to balance perceived risk and reward. If the banking rules
apply to peer-to-peer lending platforms while not licensing as a full bank status to
these businesses, they may be forced to leave the market or restructure the businesses
so as to apply for a banking license. FinTech firms have not yet collected as much
data as the banks have been doing. Access to existing financial infrastructure such as
banks’ APIs and interoperability between systems may obviously weaken the ability
to scale the business especially in the payments sector. Referring back to the unequal
treatment, the unfair advantage may be potentially supported in a process of a
regulatory sandbox. If criteria for selecting businesses to test in a regulatory sandbox
programme is not sent rightly, unclear and devoid of regulatory arbitrariness may
happen.

End-users (consumers) protection is also another important thing to consider

carefully while regulating such risky business models. In the case of financial
advisory platforms, service providers such as financial advisors may require a special
regulatory authorization like license. On the other side, regulators may regulate the
masses out of the market and miss the opportunity for greater financial inclusion
offered by FinTech by imposing strict entry requirements.

Another issue is the fraud related risks that may challenge potential investors
if regulators cannot address to prevent or manage the mis-conduct (e.g. Ezubao in
China or TrustBuddy in Sweden). General business regulations such as labor and
immigration system, company registration, tax policy, intellectual property rights,
contracting terms also can affect the development of FinTech. Inadequate data
protection standards can heavily damage public trust in the event of incidents and
FinTech as a sector will be put on a wrong track. AML/CFT issues are also of high
important concern nowadays. Unless FinTech firms cannot design to track end-users

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and transparency of operations with virtual currencies. Therefore, regulators’ ability
to draw identification procedures and exercise the capable monitoring and oversight
cannot be limited.

The regulators’ ability to update themselves with trending technology

developments is critical in managing systemic risks and solving regulatory challenges.
It has to be very timely responsive as such activities use to happen swiftly by nature.
For example, Bank of China fully banned on raising finance through ICOs (initial
coin offerings) with the reason of the risky nature of the underlying investment in
September 2017.

The weak cooperation between domestic respective regulators also cause

uncertainty and confusion that discourage innovators. There can be overlapping roles
and conflicts on an industry level (e.g. between central banks and other areas of
regulating departments). This will result in ineffective regulatory measures and
unproductive dealing with the businesses. Likewise, cooperation between
international regulatory bodies is also an area that can tackle issues related to cross-
border FinTech services.

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 Chapter III

Overview of FinTech and the Related Regulations in Myanmar

This chapter includes an overview of FinTech and brief review of financial

services sector in Myanmar. It also explains a brief history of development of FinTech
related regulations in Myanmar. Furthermore, the Financial Institutions Law (2016),

3.1 FinTech in Myanmar

Mobile wallets became popular in Myanmar almost four years ago. Since then,
mobile financial services gain the public trust gradually with the wider use in the
market and the government’s advocacy works concerning financial inclusion.

In this study, the term FinTech covers products or services which utilize
technology to deliver financial services from the business to the consumers or to the
firms themselves. The Myanmar leading banks are now on their digitization journey
and can deliver better service than some years ago. Mobile wallets are now available
and widely used in the urban areas. Moreover, online lending platform and online
invoice financing services are also available in the market. Those services will be
explained in a later part. Such financial products definitely help consumers to be able
to manage their financial needs better and to predict the future.

However, the public financial literacy is still low and that cause a slow
progress to grab the emerging opportunities on demand side. Even though mobile
phone penetration is skyrocketed, the public awareness about cyber security is still
very poor. This sort of phenomenon can put both the financial institutions and
consumers at risks. Banks and non-bank financial institutions nowadays provide
cross-cutting financial services that affect both rural and urban populations equally.
The government and international organizations encourage them to involve in poverty
reduction by means of developing financial inclusion. Some barriers such as customer
trust, human capital, legal environment and lack of required infrastructure remain
challenged for the speedy development on supply side.

The financial inclusion journey did not come very far from but there are
challenges remained even though some of the initiatives such as the aforementioned
FinTech services due to legacy problems. The United Nations Secretary General’s

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Special Envoy (UNSGSA) stated in the Annual Report 2017 that the impact of digital
finance has been demonstrated on multiple levels, from poverty reduction to GDP
growth. Yet technology carries significant risks that demand appropriate regulation,
good provider practices, and customer preparation, she wrote. The Myanmar
Sustainable Development Plan (MSDP, 2018-2030), a living document for
development in all aspects, include strategies to develop FinTech and promote
financial inclusion for the economic development. The MSDP also aligns with the
Sustainable Development Goals (SDGs 2030).

At the time of this study based on most significant data, five mobile money
service providers have registered under the Mobile Financial Services Regulation
(MFSR 2016) at the CBM. They offer remittance, cash-in/ cash-out, shopping and bill
payment services but it is yet to expand to a wider network of merchants. One online
lending platform has registered under the Financial Institutions Law (FIs Law 2016)
at the CBM. It accepts an unsecured loan application online, automates underwriting
process in real time and make a quick credit decision regardless of the customer’s
financial history. One online invoice financing service provider is also operating but it
is not yet legally allowed by regulation. But, the CBM has recognized their work is
giving a good impact to the economy.

In the banking industry, core banking software is the sole FinTech product
using in the banks. It serves daily banking operation from front office to back office.
Data management and analytics is also integrated in the system for decision making
and database management. However, cyber security and protection against it is still
weak. Public awareness for cyber-crime is also low at this time. For example, one
may share the bank account or ATM card password with others simply because it is a
friendly behavior at least. In this way, consumers can put themselves at risks using
FinTech. Financial institutions are now raising financial literacy and cyber security
awareness so that FinTech can gain momentum without any disruption due to trust
issues.

Myanmar Credit Bureau has been set up in 2018. One of the most important
part in the financial services industry is data management and analytics. Current
FinTech firms gather information and assess for their business purposes in a limited

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scale. Once the Credit Bureau is up and running, FinTech firms can extend to a wider
range of financial services.

In Myanmar of 54 million population with increasing demand of e-Commerce

nowadays, entrepreneurs are looking into quicker payment and settlement online
service business. The CBM and government has expressed their willingness to create
more dynamic market providing easier access to financial services in Myanmar for the
public. The later parts will explain more about regulating FinTech.

3.1.1 Myanmar Financial Inclusion Roadmap

The Myanmar Financial Inclusion Roadmap outlines a number of initiatives

that will alleviate poverty and increase financial access across the country regardless
of any geographic and demographic base. Under the Output 1.2 of the roadmap, it
addresses market barriers across product categories. It mentions that e-payments will
be introduced for the essential payment, clearing and settlement infrastructure as a
priority for the government. This also includes the Myanmar NPS Strategy. According
to the roadmap, it will also be necessary to migrate consumer payments to electronic
payments to electronic payment systems and to convert current non-account-based
payments undertaken by banks to account-based relationships. It aims to provide
possibility to transact electronically for all major institutions (including MFI) and
citizens. It also requires Myanmar’s integration into ASEAN Payment and Settlement
System and to provide reliable, comprehensive real time network connectivity
between banks. It also states to enhance existing laws and regulations to cater new
modes of services and providers alike while ensuring consumer protection for digital
financial services and encouraging enablers such as POS, ATM, mobile cash-in cash-
out agents, telecommunication infrastructure, and training and awareness.

3.1.2 Myanmar Sustainable Development Plan (MSDP 2018-2030)

The MSDP is a very forward looking and act like a living fortune teller document for
Myanmar’s social, economic and political development as drafted by the National
League for Democracy (NLD) government in 2018. Under the MSDP Pillar 2, Goal 3,

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Strategy 3.5.3 sets an action plan to expand the scope of mobile and FinTech services,
including through both domestic and foreign financial actors. It aims for a robust set
of commercial banks including both local and foreign-owned banks, compete to offer
a wide variety of financial products to a wide spectrum of customers in PSD AP,
Pillar 2. The CBM and Ministry of Planning, Finance and Industry are the sole
responsible government organizations. It also relates to the 12 Points Economic
Policy EP 8, Sustainable Development Goal (SDG) 8.10, SDG 1.4, SDG 5.a and SDG
8.3. The Strategy 3.7 plan to encourage a greater creativity and innovation which will
contribute to the development of a modern economy as stated in the MSDP.

3.1.3 Myanmar National Payment Systems Strategy (2019-2024)

The Myanmar National Payment System Strategy (Myanmar NPS Strategy)

sets the main broad objectives as below;

 Increase the speed and safety of payment transactions for banks, government,
businesses and individuals
 Reduce costs of payments through reducing payment transactions in cash and
through interoperability of systems and instruments
 Migrate to a less-cash society by spreading the usage of efficient electronic
payment instruments and FinTech
 Have legislation and regulations that support competition, reduce barriers for
providers of payment services, are forward looking, and promote technological
innovations in payment services
 Achieve broad access to payment services for the Myanmar population and
facilitate broader financial inclusion
 Build technical capacity of the regulators and overseers of the NPS to enable
effective oversight and timely respond to emerging risks in a rapidly changing
payment environment

Strengthen cooperation between all stakeholders in the payment ecosystem to drive

reforms

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3.2 Regulating FinTech in Myanmar

The CBM wrote in the Mobile Financial Services Regulation that “In exercise
of the powers conferred under Section 132 and 184 of the Financial Institutions Law,
2016 the Central Bank of Myanmar hereby issues the following Regulations in order
to create an enabling regulatory environment for efficient and safe mobile financial
services in Myanmar”. This regulation is followed by the Financial Institutions Law
enacted in January 2016. As a result of the Myanmar Financial Inclusion Roadmap
2015-2020 with the intention to remove barriers to financial inclusion, a Financial
Sector Development Strategy (FSDS 2015-2020) was adopted.

The World Bank recommended to strengthen financial sector legal, regulatory

and supervisory framework in its “Financing The Future” Report 2015 that is
applicable in this study. It suggested to move towards internationally recognized good
practices in financial sector regulations to establish the legal certainty required to
foster competition and investment in the sector. The bank highlighted the FIs Law
2016 to provide the basis for a well-structured, modern, and comprehensive legal
framework for the financial sector development. Followed by the FIs Law 2016, the
CBM approved the Mobile Financial Services Regulations (2016) to foster financial
inclusion and that encouraged the faster and convenient means of payment and
settlement between individuals and trading.

In 2019, the Yangon Regional Government opened the Yangon Innovation

Centre that is operated by Seedstars Myanmar in collaboration with Thura Swiss. The
centre was developed to boost tech start-ups and facilitate financing mechanism for
the entrepreneurs including FinTech. One of the Myanmar’s leading banks, the CB
Bank, has empowered the centre and has been actively looking into developing the
FinTech areas such as AI (Artificial Intelligence), payment innovation and other
trending initiatives. The government arranged online electricity bill payment and
online pension payment system in cooperation with the mobile financial service
provider in 2018 and it is assumed that the government is trying to develop FinTech in
some ways.

The CBM has been developing its cash payments for both M1 (narrow money)
and M2 (broad money), non-cash payments such as cheques, drafts, bills of exchange,
promissory notes, money orders and postal orders. The regulators are also trying to

xxiii
develop card payments as well. The Myanmar Payment System Development
Committee (MPSDC) is solely in-charge this activity. The CBM has been working on
MMQR code to standardize QR (Quick Response) code for Myanmar. CBM NET
system development is also in progress that is working with Nippon Telegraph and
Telephone Corporation (NTT) Data to develop a new core banking system for the
settlement of government bonds, funds and collateral management funded by the
Japanese Government. Myanmar Payment Union (MPU) was established with three
State-owned Banks and fourteen domestic private banks contributing equal shares of
capital. Myanmar Investment and Commercial Bank (MICB) is the settlement bank
for the MPU. (Myat Sandar Kyaw, A study of development of payment system in
Myanmar banking industry, 2015)

The CBM laid out its National Payments System Development Strategy
(Myanmar NPS Strategy) (2019-2024) in May. The strategy was drawn on the basic
and realistic ground of the CBM’s currently available infrastructure and very forward
looking in nature according to U Bo Bo Nge, Deputy Governor of the CBM during
the National Payment System Strategy forum in 2019. The key strategic areas of
Myanmar NPS Strategy focus to modernize the payment and settlement infrastructure,
to strengthen institutions and enhance payment instruments and services in the short
term, medium term and long term (The Myanmar NPS Strategy Document, 2019).
The Deputy Governor highlighted that transaction fees are currently high and they
were trying to develop the RTGS (Real Time Gross Settlement) system to facilitate
interoperability between banks. The regulator further explained to enhance the
clearing and settlement rules and mechanisms, oversight framework and human
capacity development in order to adequately conduct regulatory and supervisory
functions at the CBM.

3.3 Regulations related to FinTech

The CBM as the regulator enacted the Financial Institutions Law(FIs Law) in
January 2016. The Regulation on Mobile Financial Services (MFS) (2016) aimed to
create an enabling regulatory environment for efficient and safe mobile financial
services in Myanmar under the FIs Law. (Regulation on Mobile Financial Services,
CBM, March 2016). The CBM issued the Mobile Banking Directive in 2013.

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3.3.1 Financial Institutions Law

According to the CBM’s announcement of the Financial Institutions Law (2016),

the following legal items are taken to point out how it applies to FinTech.

The law prescribes as follows: Chapter 6 states items related to Non-Bank

Financial Institutions and Foreign Bank Representative Office; Chapter 18 states
items related to E-Money, E-Banking and Mobile Banking; Chapter 19 states items
related to Oversight of Payment and Settlement System; Chapter 22 states items
related to Electronic Evidence; and Chapter 25 states items related to Prohibitions.

3.3.2 Mobile Financial Services Regulations

According to the Mobile Financial Services Regulations (MFSR) (2016) under

the FIs Law (2016), a non-bank may receive a license even though the licensee must
be a multi-national organization (MNO) or company established solely for MFS (with
its parent company having relevant experience) and must have registered capital of at
least 3 billion MMK.

3.3.3 Mobile Banking Directive

According to this Mobile Banking Directive issued by the CBM in 2013, the
license may only be granted to a bank licensed in Myanmar and local banks have
received such licenses. The bank or licensee may partner with private firms and/or
MNOs and engage a network of cash agents for the purposes of providing the
services. However, the bank holds the absolute liability to the customers and so it
owns the customer base that requires to open the bank account under the respective
individual customer.

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 Chapter IV

ANALYSIS ON ISSUES ENCOUNTERED REGULATING

FINTECH WITHIN THE FINANCIAL SERVICE BUSINESSES OF
MYANMAR

This chapter presents the analysis of the study on issues encountered

regulating FinTech in financial service businesses of Myanmar. The primary data in
this analysis was collected by using a structured survey questionnaire and the analysis
was carried out on SPSS software. The responses are recorded, and issues
encountered are presented in percentage after analysis. The respondents of the survey
include senior management executives and senior managers from some commercial
banks, investment firm, FinTech startups, insurance company, payments network
service provider, IT companies, tech startups accelerator and FinTech software
service provider.

4.1 Research Design

The main objectives of this study are to identify the regulations for FinTech in
Myanmar and to examine issues encountered regulating FinTech within financial
service businesses of Myanmar. Primary data collection was done through a
structured questionnaire and secondary data from reports, working papers, news and
other related research studies of the reliable sources. The survey was conducted via
emails among executives and senior managers in seven commercial banks (KBZ,
AYA, CHIDB, MTB, CB, MAB, MCB), two investment firms (Omidyar Network
and SSP Ventures), three FinTech startups (2C2P, nexlabs and Dinger), one insurance
company (AYA Myanmar Insurance), one payments network service provider
(Myanmar Payment Union), three IT businesses (PwC Cyber Security, Myanmar
Information Technology and Kernellix), a tech accelerator (Phandeeyar) and one
FinTeh solution provider (Finastra formerly known as Misys).

The survey was conducted in one week from 26th December 2019 to 2nd
January 2020. The sample size is twenty-two out of thirty-six population of financial
service and IT businesses. The questionnaire was organized in eleven sections that

xxvi
branched out to related statements respectively. The sections are financial inclusion,
ease of doing business, ecosystem, regulatory support and other factors pertaining to
FinTech in the financial service businesses of Myanmar. The binomial type survey
was comprised of thirty-nine statements.

4.2 Demographic Profile

The study sample population was twenty two out of thirty-six in total that the
survey was circulated. The twenty-two respondents represent sixty one percent of the
total sample size. Even though the response rate was just over a half of the sample
size, quality of the respondents shows a strong representation such as their roles and
responsibilities, experience, expertise and organizations. The survey recorded their
roles and type of their businesses that supports their response adequacy accordingly.
Sixteen Chief Executive Officer and Managing Director or equivalent to these ranks
participated in the survey. It accounts for almost seventy three percent of the total
respondents. Six executive level staff answered the survey which is about twenty
seven percent of total response rate.

Table (4.1) Role of Respondents

Role No. of Respondent Percent
Senior Management 16 72.73
Executive 6 27.27

Total 22 100.0

Source: survey data, 2019

As the table below states that twelve senior bankers accounted for about fifty
five percent of total respondents. It is followed by four IT experts taken for almost
eighteen percent. Each two from the investment firms and FinTech entrepreneurs are
recorded as about nine percent equally. The survey recorded also from a leading
insurance company’s Managing Director and the CEO of a tech hub with a percentage
of 4.55.

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Table (4.2) Type of Business vs. No. of Respondent
Type of business No. of Respondent Percent
Banking 12 54.54
Investment 2 9.09
FinTech Startups 2 9.09
Insurance 1 4.55
IT 4 18.18
Accelerator 1 4.55
Total 22 100.0

Source: survey data, 2019

4.3 Analysis on Issues Encountered Regulating FinTech within Financial Service

Businesses of Myanmar

The study sample population was twenty two out of thirty-six in total that the
survey was circulated. The twenty-two respondents represent sixty one percent of the
total sample size. Even though the response rate was just over a half of the sample
size, quality of the respondents shows a strong representation such as their roles and
responsibilities, experience, expertise and organizations. The survey recorded their
occupation and type of their businesses that supports their response adequacy
accordingly. Sixteen Chief Executive Officer and Managing Director or equivalent to
these ranks participated in the survey. It accounts for almost seventy three percent of
the total respondents. Six executive level staff answered the survey which is about
twenty seven percent of total response rate.

4.3.1 Financial Inclusion

Referring to the table (4.3) below, respondents were asked to express their
views about the issues encountered for financial inclusion in Myanmar at present.
First and foremost, the survey asked if the financial inclusion programs reach out to
the people with the least financial knowledge and access to formal financial services.
The second and third statements are to check whether organizations and government
working for financial inclusion provide clear and reliable information to the public.
The last one examines if the general public as customers would still like to use cash
payments against digital payments or FinTech services.

xxviii
Table (4.3) Financial Inclusion
No. Statement Yes No Issue
%
1 Financial inclusion programs reach out to places where 9 13 59.01
most financial literacy illiterates exist.

2 Organizations working on financial inclusion provide 10 12 54.55

clear and reliable information to the public.

3 Government led projects related to financial inclusion 8 14 63.64

provide clear and reliable information to the public.

4 General public prefer using FinTech such as digital 7 15 68.18

payment rather than cash payment.

Source: survey data, 2019

According to the analysis, it is found out that 59.01 percent of the respondents
answered that financial inclusion programs reach out to the least financially literates
population. 54.55 percent and 63.64 percent of them responded that public was not
provided with the clear and reliable information by the organizations and government
through their financial inclusion projects respectively. 68.18 percent of respondents
said that the general public still like to use cash rather than digital payments using
FinTech.

4.3.2 Ease of Doing Business

In this section, the survey statements include clarity and supportiveness of

existing regulations to start a FinTech business. It also includes effective protection
for the businesses and users by existing regulations related to IT. The third one is
about whether a FinTech business still face barrier of conservative restrictions. And, it
includes statements finding ease of investing in FinTech start-ups based on existing
regulations and any tax incentives offered for FinTech start-ups.

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Table (4.4) Ease of Doing Business
No. Statement Yes No Issue
%
1 Existing regulations for FinTech are clear and 2 20 90.9
supportive to start business.
2 Existing regulations related to information technology 3 19 86.36
protect both businesses and users effectively.
3 FinTech business can start without any conservative 7 15 68.18
restrictions.
4 It is easy to invest in FinTech start-ups according to 7 15 68.18
existing regulations.
5 Tax policy favors of FinTech startups. 4 18 81.82

Source: survey, 2019

Based on the above data, 90.9 percent of the respondents answered that
existing regulations with regards to FinTech are clear and supportive. 86.36 percent
responded that existing regulations for IT effectively protect both businesses and
users. 68.18 percent said that FinTech business still face the conservative restrictions
to start its business. 81.82 percent of the respondents do not agree that FinTech start-
ups are given favors for any taxation.

4.3.3 Ecosystem

In the ecosystem part, the survey explored three pillars link; regulator,
financial institutions and consumers.

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Table (4.5) Ecosystem
No. Statement Yes No Issue
%
1 FinTech businesses can expand according to existing 19 3 13.64
FinTech regulations.
2 Institutions working for FinTech ecosystem are 12 10 45.45
professional and efficient.
3 Government eagerly encourages competition of 7 15 68.18
FinTech businesses in the market.
4 Cooperation among related businesses and, between 7 15 68.18
businesses and government bodies are good.
5 The business community has a collective plan to 12 10 45.45
develop FinTech.
6 Banks demand FinTech solutions. 20 2 9.09

7 Government has an effective consumer complaint 7 15 68.18

arrangement for FinTech users.

Source: survey, 2019

According to the above table (4.5), there can be issues to expand FinTech
business based on existing FinTech regulations by only 13.64 percent of the
respondents. And 45.45 percent said that institutions working in the FinTech
ecosystem are professional and efficient. 68.18 percent states that government does
not eagerly encourage competition of FinTech businesses in the market. Cooperation
among businesses themselves and between businesses and government bodies are not
good as found out from 68.18 percent of the respondents. 45.45 percent said that the
business community has a collective plan to develop FinTech sector in Myanmar.
68.18 percent answered that government does not have an effective consumer
complaint arrangement for FinTech users.

4.3.4 Regulatory Support

In this part, the 16-statement survey finds out the issues arising from the
regulator side. These issues are related to collaboration, consultation with the related

xxxi
stakeholders, strategy and action, internal coordination and enforcement of required
regulations.

Table (4.6) Regulatory Support

No. Statement Yes No Issue

%
1 Cross-department coordination within the government 2 20 90.9
is efficient.
2 Government collaboration with key international 4 18 81.82
partners is productive.
3 FinTech firms can provide safe and secure 18 4 81.82
products/services only when government enforces
AML/CFT regulations strictly.
4 Working groups for the respective initiatives are 10 12 54.55
designed to include all parties related.
5 Administrative level engagement with the financial 9 13 59.09
service businesses is constructive.
6 Regulator led consultation and discussion meetings are 12 10 45.45
constructive.
7 Government has a strategic vision to develop FinTech 13 9 40.9
sector in Myanmar.
8 Government sets out strategic plan to develop FinTech. 7 15 68.18

9 All FinTech businesses including foreign ones are 7 15 68.18

treated fairly.
10 Government protects intellectual property rights for 6 16 72.73
FinTech effectively.
11 Making policies for FinTech are transparent and 5 17 77.27
realistic at present.
12 The regulator’s supervisors for FinTech are effective. 7 15 68.18

13 Regulators are proactive to develop FinTech 4 18 81.82

regulations.

xxxii
14 Government deploys required resources efficiently and 5 17 77.27
monitor progress regularly FinTech sector
development.
15 Government budget is sufficiently provided for the 3 19 86.36
required FinTech development.
16 Government manages the underlying issues that may 2 20 90.9
cause delay to develop FinTech.
Source: survey, 2019

More than 90 percent of the respondents stated the issues of cross-department

coordination within the government and managing the underlying issues that cause
delay to develop FinTech. For insufficient government budget provided for FinTech
development, government collaboration with key international partners, not enforcing
AML/CFT regulations strictly and regulators not being proactive, are the second
highest scored issues with more than 80 percent respondents expressed. The third
issues are protecting IP rights, efficient resources deployment and, making transparent
and realistic policies with over 70 percent respondents. The latter issues follow by
over 60 percent respondents for strategic plan for FinTech development, treating all
FinTech businesses fairly and effective regulatory and supervision capacity of the
regulators. All-inclusive working groups initiatives and government’s administrative
level staff engagement related issues are raised by over 50 percent of the respondents.

4.3.5 Others

These statements are set out to find out other important factors such as cost to
consumers, trust, guidance for safe use of FinTech, AML/CFT and data protection, in
issue of FinTech regulatory environment.

xxxiii
Table (4.7) Others

No. Statement Yes No Issue

%
1 People are willing to pay a reasonable fee for FinTech 17 5 22.73
services.
2 Mobile financial services usage increased only in a 20 2 9.09
short duration.
3 Public trust FinTech services currently in the market. 6 16 72.73

4 Proper regulations protect FinTech service users. 5 17 77.27

5 Instructions for safe usage of FinTech services are 5 17 77.27

guided effectively.
6 Businesses agree to absolutely follow global standards 6 16 72.73
of AML/CFT regulations.
7 Regulator should develop FinTech sector only with a 12 10 45.45
proper data management system and regulations ready.
Source: survey, 2019

To explain the table (4.7) above mentioned with over 70 percent respondents’
answers, public trust for FinTech services, regulations for FinTech, instructions for
safe usage of FinTech and AML/CFT global standards compliance on the business
side are others issues pertaining. Even though only 22.73 percent and 45.45 percent of
respondents reported their concerns for reasonable price and data protection
regulations, these two are also still existing issues.

xxxiv
 Chapter V

Conclusion

This chapter reviews on the discussion of the data findings and suggestion on
the issues encountered regulating FinTech within the financial service businesses of
Myanmar.

5.1 Findings

The main objectives of this study are to identify the regulations for FinTech in
Myanmar and to find out issues encountered regulating FinTech within the financial
service businesses of Myanmar. A structured survey comprised of thirty-nine
statements was used to collect information from twenty-two senior executives from
the financial and IT businesses operating in Myanmar.

This study proved that financial inclusion in Myanmar is still facing

challenges due to issues found out by the analysis data aforementioned. Public’s
preference to cash over digital payments is also observed to be difficult to develop
and this is associated with public trust, government’s consumer complaint mechanism
and proper rules and regulations related to FinTech. Other areas of finding for issues
are the needs of clear and reliable information provided from the stakeholders to the
least financially literate population. The study also addresses to enforce AML/CFT
global standards so that FinTech businesses can provide their services safely and
securely in the market. Most importantly, many issues also lie on the regulator and
government sides. The government budget is not sufficient enough to develop
FinTech sector and to deploy the required resources efficiently as well as to monitor
the progress of FinTech development. The study alarms that government’s cross-
department coordination is critically required attention. Likewise, its cooperation with
the key international development partners in the financial service sector also requires
focus. When making policies, transparency and consultation with the respective
stakeholders remain an issue. The government’s strategic plan to develop FinTech
was not satisfactory according to the survey. The respondents demand the regulator
to be proactive to develop FinTech in Myanmar. And also, the business community

xxxv
was not strongly pleased almost half of the respondents participated the survey with
regards to develop FinTech sector collectively with other stakeholders.

5.2 Suggestion

According to the objectives of the study, the following suggestion were made:
this study recommends the regulator to lead regulating FinTech in collaboration with
the financial service businesses closely and proactively. According to the findings
under ‘Ecosystem’ section, it is also suggested to the regulators to make an initiative
of typical style of regulator-FIs-FinTech startups-consumers in a controlled
environment something like the regulatory ‘sandbox’ to efficiently regulate so that
innovators and the financial businesses can predict their business models with
certainty.

Financial inclusion should be put as a high priority targeting the lowest

financially literate population while making FinTech works for all. It is inferred that
the regulators need to engage with all the respective stakeholders for the respective
strategies and plans to get their insights on a systematic and regular basis. I would like
to encourage financial business-related associations such as Myanmar Banks
Association and Myanmar Microfinance Association collectively engage and
encourage the regulator to secure their commitments to build an ecosystem that is
cost-effective, better customer experience and quicker services. This inference is
referred to the statements of regulator led consultation and the strategic vision of the
government and government’s plan mentioned under the ‘Regulatory Support’ section
of the analysis.

According to the statements about increasing usage of MFS and willingness to

pay under ‘Others’ section, ‘Trust’ issue should be addressed by the organizations and
government as a part of scaling up their financial inclusion projects which were found
out to be lack of effectiveness in ‘Others’ and ‘Financial Inclusion’ sections. It is also
advised the regulators to convince the businesses to comply with the AML/CFT
global standards. I would like to suggest the government to organize the advocacy
campaigns about safe usage of FinTech and data security across the financial service
industry.

xxxvi
5.3 Needs for further study

The study suggest that the further research should be conducted on challenges
to regulate FinTech in Myanmar into more details by prioritizing the areas based on
the specific criteria such as benefit to the economy, fulfilling the public’s fundamental
needs, customer demand and government’s development strategy beyond this study’s
two objectives in this research.

xxxvii
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1. Raouf Sussi (2018), Swift GPI: The Digital Revolution Makes Its Marks In
International Payments, BBVA Investment Banks.
2. Matthew Cocchrance (2019), Top 10 Fintech Stocks to Buy Now, NASDAQ:
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for FinTech: Global Trends From A UK Perspective, Innovate Finance
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6. Buenos Aires (2017), The FATF Position On FinTech And RegTech: The
FATF Met Today to Discuss How Countries Are Approaching FinTech & Reg
Tech Innovations
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Fraud In The Age of Cyber Security , McKinsey & Company.
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Role in Fostering Innovation.
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Uncertain Future For Small And Medium-Sized Enterprise Lending, A Study
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xxxviii
 APPENDIX A

1. Survey Cover Letter

Dear Sir/Madam,

My name is Kaung Htet Zaw. I’m currently doing my Master of Banking and
Finance Degree thesis on Issues Encountered Regulating FinTech within Financial
Service Businesses of Myanmar at the Yangon University of Economics. This
study finds out about gaps between the regulator and private sector and highlights
other matters pertaining to regulate FinTech.

I'm grateful if you could spare some time to fill out my survey. I'll use the
anonymous data to present in my thesis. Kindly note that questions are not really
orderly arranged and may link each other but some do not. The statements are
prepared just to collect information but do not necessarily reflect to the
researcher’s own views.

Please feel free to answer the questions. Your honest response is much
appreciated.

Many thanks,
Kaung.

xxxix